An open-ended registered fund is subject to the Registered Collective Investment Scheme Rules 2008 and the Prospectus Rules 2008.
The main characteristics of a registered open-ended fund are as follows:
In February 2007, the GFSC introduced a new registered fund regime for fast tracking closed-ended funds. This new regime was extended to open-ended funds in December 2008. In conjunction with the 2008 changes, the Guernsey Financial Services Commission (“GFSC”) issued three new sets of rules under POI:
Under the registered fund regime, an administrator can apply for a fund to be registered by the GFSC by completing a Form REG, which must be signed by the administrator. The Form REG contains the following requirements and warranties:
The GFSC attaches great importance to these requirements. It expects the administrator to be in a position to have documentary evidence to support these requirements and be able to produce such evidence immediately at the request of the GFSC. Applicants who cannot substantiate their applications will be excluded from participation in the registered funds self-certification programme.
The following documents should also be lodged at the GFSC together with the Form REG:
On receipt of all of the above documentation, the GFSC will register the fund within three working days. The administrator is encouraged to liaise with the GFSC in advance if it has any concerns about the promoter or the fund to avoid any potential delays in the three working day consent.
Registered may be established as companies, unit trusts or limited partnerships or such other vehicle or entity as may be approved by the GFSC. Each scheme must be established with the objective of spreading risk and the criteria must be specified in the information particulars.
Closed-ended funds (authorised or registered) are not required to appoint a custodian and may appoint a custodian or trustee that is domiciled outside Guernsey.
The designated manager of a registered fund must submit to the GFSC within six months of the end of each financial year the audited annual report and accounts together with any principal documents or other agreements which have been amended. There is also a requirement to file quarterly statistical information.
The RCIS Rules provide that registered funds must not be offered directly to the public in Guernsey but may only be offered to Guernsey regulated entities or offered to the public indirectly by entities appropriately licensed under POI.
The designated manager of every registered fund must notify the GFSC in writing annually of any changes in the information contained in the application form submitted for registration of the fund.
The first such notification has to be submitted to the GFSC within 12 months of the date on which a declaration of registration was issued and thereafter at intervals of not more than 12 months. Nil returns are required.
The designated manager of a registered fund is required to give written notice forthwith to the GFSC of any proposed change of designated manager or designated custodian and any proposal to reconstruct, amalgamate, terminate prematurely, wind up or extend the life of the scheme.
Notably, both the RCIS and ACIS Rules only require notification of these matters to the GFSC. They do not explicitly require GFSC consent to the proposed changes. Nonetheless, recent guidance issued by the GFSC has clarified that where the proposed change is to the designated manager (administrator) or custodian (where relevant) GFSC consent to the change is required in order to amend the formal authorisation or registration issued to the fund under POI.
The Prospectus Rules 2008 set out the disclosures that must be made to investors in a registered collective investment scheme. These disclosure requirements differ in some respects, notably: